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PayPal is seeking to form its own bank, a move that could significantly expand its small business lending operations and reshape how consumers use the payments platform, The Washington Post writes.
The company has applied for a banking charter in Utah and with the Federal Deposit Insurance Corporation to create PayPal Bank, which would allow it to offer interest-bearing savings accounts and provide federally insured deposits. If approved, the charter would also allow PayPal to rely less on third-party banks while scaling loans to small businesses, a segment where it has already issued $30 billion in financing since 2013.
The application comes amid a broader push under the Trump administration to loosen banking regulations, enabling nontraditional players, such as digital asset firms, to pursue bank charters.
Supporters say the shift could increase competition and access to credit, while critics warn of new risks to the financial system. For PayPal, the move signals an ambition to evolve from a payments provider to a full-service financial institution.
